Liberty Global increases ITV stake to 9.9% but denies takeover plan

http://www.theguardian.com/media/2015/jul/31/liberty-global-itv-stake-takeover-virgin-media

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International cable operator Liberty Global has raised its stake in ITV to 9.9% but said it had no intention of taking over the UK’s biggest free-to-air commercial TV firm.

Liberty, the owner of pay-TV company Virgin Media, took a 6.4% stake in ITV a year ago, and in September said it had no plans to increase the holding.

“Given ITV’s operating and stock price performance, we were able to increase our stake to 9.9% with no incremental investment by hedging our existing equity position,” Liberty said on Friday.

Related: ITV profits up 25% despite continuing decline in ratings

“This investment remains an opportunistic one for us in our largest market.“

Liberty Global confirmed it did not intend to make an offer to acquire ITV.

Backed by US tycoon John Malone, who also controls Liberty Media Corp and Discovery Communications, Liberty Global has bought cable assets across Europe in the past decade and has more recently started buying strategic stakes in content producers.

ITV has been snapping up independent production companies, including The Voice producer Talpa Media in March and Poldark maker Mammoth Screen in June, to reduce its reliance on its broadcasting business in the UK.

Liberty bought its initial holding in ITV from satellite broadcaster Sky in July 2014 for £481m, a deal that boosted ITV’s share price by 8% as investors bet that a full takeover would follow.

Shares in ITV, which reported a 25% increase in first-half pre-tax profit on Tuesday, have risen by 57% since Liberty bought its initial stake.

Analyst Ian Whittaker at Liberum said he expected ITV’s shares to jump again on Friday.

“Liberty has stated it does not intend to make a bid for ITV but its move suggests that it thinks a move by another player is likely or, at least, an increasing possibility,” he said.